Looking to Expand? Tips for Growing Your Small Business
As challenging as starting a small business can be, often times growing that business can be even harder. A common mistake that entrepreneurs make is trying to expand their company before they have a perfect, scalable business plan. If you’re considering expanding your small business, here are some tips for ensuring your success.
Niche, Branding, and Community
With the rise of big box stores, more and more Americans are actively looking for small businesses to support. While smaller stores may not be able to offer the same low prices as some of the big guys, small businesses are more able to tailor the customer experience and ensure that it is a positive one.
Many small businesses cater to a specific niche that is underserved in some way. Your company will need to be an expert in this niche, know how to meet the customers’ needs, and know how to react to changes in those needs. Additionally you should focus the majority of your resources on attracting your target market instead of wasting money on broad advertisements. Today there are a number of analytics platforms that can easily assist you with evaluating and finding your best customers.
The number one way to build a sustainable business is to build a strong brand. As part of your branding, you should identify what part of your business sets you apart from you competitors and what value (not necessarily in price) you offer to customers.
One of the reasons people like supporting small businesses is because they enjoy the feeling of supporting a community. Building a community around your brand is an invaluable way to not only attract customers but engage them as well. While social media is an important part of this, participating in local events or organizing your own events will help earn you both fans and customers in your area.
Have a Strong Team
When you’re running a single location or small operation it’s easy to ensure that everything is handled properly since you’re usually doing it yourself. Unfortunately as your business expands you can’t be everywhere at once. That’s why building a team that shares your vision, work ethic, and integrity is paramount.
Your employees are more than just hired help; they’re partners in the success of your business and it’s important to make them feel as such. The SBA suggests empowering, incentivizing, and mentoring your employees so that they have a vested interest in doing the very best they can to help your customers and make sales. You should also remember that skills can be taught but attitude cannot. If your employees aren’t interested in what they’re doing it will show and could negatively impact business.
Empowering your employees doesn’t mean putting the weight of the entire business on their shoulders. Every business needs a leader and that leader also needs to be present. Too often when a business becomes successful entrepreneurs are willing to take a step back, only to have the company crumble without their influence. It’s important to let your employees learn to make decisions on their own but you need to make sure they are held accountable for the results of those decisions. By enforcing accountability you will not only earn the favor of your employees but also avoid any surprises down the road.
You’ve probably heard the old saying, “You’ve got to spend money to make money.” Cliché as it may be it is also true. This harsh fact is why many entrepreneurs have turned to venture capital firms and reality TV shows alike in hopes of expanding their businesses. However since not every business will have the opportunity to go on Shark Tank or have access to venture capital firms most will have to find their own capital in order to grow their company.
In today’s economy there are more options than ever for small businesses to secure loans or investments. While traditional banks are still an option, the Internet has fostered a number of alternative lenders like Lending Club and Kabbage. Both companies offer loans to small businesses that may have a hard time getting approved at a regular bank.
Lending Club is the leader in peer to peer loans. Through their platform borrowers can apply for a small business loan for up to $300,000. Once approved the loans are actually fulfilled by investors — more than likely multiple investors since individual lenders can kick in as little as $25 towards any given loan. Those lenders will then receive a piece of the interest you will pay on the loan.
Peer to peer lending is one facet of a growing movement known as crowdfunding. The same principles that have been used to fund independent film projects and novelty products on sites like Kickstarter are also being used to sell equity stakes in small businesses. Sites like EquityNet allow companies to raise money by soliciting investors. Although this service is currently only available to accredited investors, many predictions insist that the long-delayed move to open the doors to others will come within the next couple of years.
Before a business can grow their current operations must be fine-tuned. A sloppy expansion strategy will not only endanger your future operations but could be the downfall of your business entirely. Taking the time to craft a brand, build a strong team, and find the best financial resources available will put you well on your way to growing your business into what you know it can be.